EU Non-bank Financial Intermediation Risk Monitor 2021

The ESRB has published the EU Non-bank Financial Intermediation Risk Monitor 2021 (NBFI Monitor). This is the sixth issue in an annual series monitoring non-bank financial intermediation, an area which has grown in recent years and now accounts for around 40% of the EU financial system.

This issue of the NBFI Monitor focuses on data up to end-2020 and includes three special features on the following topics:

• the vulnerabilities of commercial real estate (CRE) funds; data are used to analyse the leverage and liquidity of real estate funds in view of the outbreak of the coronavirus (COVID- 19) pandemic;
• the role of insurers in credit intermediation, their interconnectedness with funds and the derivatives they hold;
• the Gamestop, Greensill and Archegos incidents, which highlight search for yield behaviour, interconnectedness and the use of derivatives to increase leverage positions.

The NBFI Monitor also identifies cyclical risks and structural risks and vulnerabilities affecting the non-bank sector.

The entire publication can be found here.